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Ireland extends domestic reverse charge

  • VAT
  • 27 October 2015 | Richard Asquith

Ireland extends domestic reverse charge

In its newly released Finance Bill, Ireland has proposed extending the use of the domestic reverse charge to include the wholesale supply of gas or electricity.

The measure is to help combat VAT fraud. The European Commission assessed this issue at up to €177 billion per annum in lost revenues for the EU member states.

Much of the fraud is carried out as ‘missing trader fraud’ in areas such as energy trading. This involves criminal gangs claiming to buy goods domestically, and then sell them with the EU VAT free as an intra-community supply. However, in reality, they sell them domestically with a fraudulent VAT charge and do not pay on the tax to the authorities. Complex versions of this crime involve multiple dummy companies across the EU repeatedly claiming to sell and resell the same goods without VAT. This is known as ‘carousel fraud’.

Aside from imposing the reverse charge on wholesale selling of power, the tax authorities have also included the sale of energy trading certificates.


VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.